Obama Oil Windfall Tax

Oh great, who does he think will see the hit from a tax on oil "Windfall" profits? Exxon (A publicly traded company)? I dont think so, it would end result in money being taken out of the consumers pocket.

Obama says he would impose oil windfall profits tax
Mon Jun 9, 2008 1:35pm EDT
RALEIGH, North Carolina (Reuters) - Democratic presidential candidate Barack Obama said on Monday he would impose a windfall profits tax on U.S. oil companies as he sought political gain from Americans' pain over high gasoline prices.

Launching a two-week focus on the economy after clinching the Democratic presidential nomination, Obama drew a sharp contrast between his economic policies and those of John McCain, his Republican rival in the November election.

"I'll make oil companies like Exxon pay a tax on their windfall profits, and we'll use the money to help families pay for their skyrocketing energy costs and other bills," the Illinois senator said.

Obama charged that McCain's support for extending President George W. Bush's tax cuts means he is in favor of $2 trillion in corporate tax breaks, including $1.2 billion for Exxon Mobil Corp.

"If John McCain's policies were implemented, they would add $5.7 trillion to the national debt over the next decade. That isn't fiscal conservatism, that's what George Bush has done over the last eight years," Obama said.

I doubt Obama will do this. The rising gas prices are hurting all of us, but he's gonna say what it takes to win the votes in get into office. I've also heard Obama talk about not relying on oil from foreign countries and figure out ways of using more reliable and safer sources of fuel. Bush mentioned this same thing, but never actually did squat about it. His time's almost up anyhow. He doesn't care about what happens.

I just dont understand how he can sell this to the normal american person. If you take money from a company in one area "Windfall Tax" then they are just going to recoup that lose elsewhere... so why not just tax us directly... oh, because then he wouldnt be a person of the people, instead he looks like he is attacking big bad oil companies.

And one more thing that grinds my gears is that he mentioned Exxon as an example. THAT IS A PUBLICALY TRADED COMPANY. (XOM) SO now when you tax the "Windfall" it immedietly takes money from the stock holders pocket, AND then down the chain to the consumer....

Yep - so then they lose motivation to explore, drill and produce more oil, as its only taxed higher when they are successful.

What is interesting is comparing the profit margins of the big oil companies vs. other American companies. Do that and you find they are well below MANY other industries. So - when do we start the windfall taxes on Google, or other software industry companies? Googles profit margin was over 25%! XOM was around 8%.

Basic economics is beyond most people to understand, that's why ideas like this are still kicked around. It is actually impossible to pass taxes off to consumers as the price rise merely affects marginal behavior and lowers consumption. What all taxes really do in the end is inhibit production. So the argument from the tax and spend crowd really runs like this: "If we produce less we will be wealthier." Pure idiocy, but most people don't have the brain power to follow history, much less the economic know how to understand why it's idiocy.

Basic economics is beyond most people to understand, that's why ideas like this are still kicked around. It is actually impossible to pass taxes off to consumers as the price rise merely affects marginal behavior and lowers consumption. What all taxes really do in the end is inhibit production. So the argument from the tax and spend crowd really runs like this: "If we produce less we will be wealthier." Pure idiocy, but most people don't have the brain power to follow history, much less the economic know how to understand why it's idiocy.

For answers to board issues, read the Suggestion and News forum at the bottom of the main page.

Basic economics is beyond most people to understand, that's why ideas like this are still kicked around. It is actually impossible to pass taxes off to consumers as the price rise merely affects marginal behavior and lowers consumption. What all taxes really do in the end is inhibit production. So the argument from the tax and spend crowd really runs like this: "If we produce less we will be wealthier." Pure idiocy, but most people don't have the brain power to follow history, much less the economic know how to understand why it's idiocy.

though i agree with you, any type of socialist program should be reflected within the taxes people pay. This is why i find it kind of strange to be running a socialist program in the economic state we are now. I think our main focus right now should be increasing our alternative energy sources; making solar collector panels more of a standard in areas that would see a benefit from it, developing more intelligent hybrid car designs, etc. I believe a lot of the price rises is due to transportation costs right?

Secondly, if prices of energy went down due to ability to produce it within your own facilities/buildings and then getting tax cuts from it (due to it being a green technology), then who knows what we'll see as far as job markets and production levels.

Our main focus now should be to open areas to drill. The market doubts anyone can deliever more crude oil production in the future. Hence - the price has to rise to moderate consumption about where it is (if crude production doesn't grow further from where it is).
So - repeal the federal drilling ban and let states decide if they want to allow drilling.

2nd focus should be what to tackle next for billions of people. The infrastructure won't appear overnight for hydrogen powered cars. You can't wish for that stuff to take over in a year.

As a small independent oil producer here in the Illinois Basin, all I can say is, "Obama can suck MAH d!ck!"

Our blessed governor recently tried to pass a 5% tax here in IL. Luckily, that didn't make it through.

I want to know where all these cry babies were when oil was $12 a barrel? Oh, wait, they were suckin' up the cheap fuel. I didn't see anyone lending oil producers a hand when they were barely making enough to keep their doors open. Oh how the tides have turned... for now.